Critical Vote on Bitcoin Custody Legislation Approaches as US House Attempts to Override Biden’s Veto

  • The US House of Representatives is poised to vote on crucial cryptocurrency legislation on Wednesday, July 10.
  • This potential decision may overturn President Joe Biden’s veto concerning the Securities and Exchange Commission’s (SEC) resolution to rescind Staff Accounting Bulletin 121 (SAB 121).
  • Industry experts argue that SAB 121 negatively affects financial institutions’ ability to manage Bitcoin and other digital assets.

This article delves into the impending House vote on SAB 121, the implications for the crypto sector, and explores alternative legislative strategies.

Key Developments in the Pending Vote on Crypto Legislation

The House of Representatives is gearing up for a critical vote that could potentially overturn President Biden’s veto of the SEC’s decision to repeal SAB 121. Initially promulgated in 2022, SAB 121 requires banks holding cryptocurrency to disclose those assets as liabilities on their balance sheets.

Many within the crypto community contend that this measure imposes an undue regulatory burden on financial institutions, thereby discouraging their engagement with digital assets. A previous House resolution opposing SAB 121 saw bipartisan support, passing with a 228-182 vote, but President Biden blocked it with a veto in June.

Challenges and Bipartisan Efforts

The upcoming vote seeks to override the presidential veto—a move that will necessitate a two-thirds majority in both Houses. Ron Hammond from the Blockchain Association highlights the significance of these developments, emphasizing the unusual political dynamics as “crypto has now found itself to be a campaign issue.” He points out that gaining the required two-thirds majority will be a steep climb, given the limited Democratic support previously.

Perianne Boring of the Digital Chamber calls for increased backing from House Democrats, underscoring that approximately 60 more votes are needed to nullify SAB 121. This reflects the critical need for cross-party cooperation to effect significant changes in the regulatory landscape governing cryptocurrencies.

Alternative Legislative Pathways

Given the hurdles in overturning the veto, lawmakers are also considering alternative strategies. Journalist Eleanor Terrett from Fox Business cited sources indicating that many Democrats are unlikely to change their stance in the upcoming vote. Instead, efforts may pivot towards HR 5741—the Uniform Treatment for Custodial Assets Act—introduced by US Rep Mike Flood and supported by bipartisan cosponsors. This bill aims to address the accounting treatment of digital assets in a more balanced manner.

Moreover, the House Appropriations Committee has suggested including a policy rider in the budget bill to restrict the SEC’s funding for enforcing SAB 121. This alternative approach reflects a multifaceted strategy to recalibrate the regulatory framework for crypto custodianship.

Conclusion

The impending House vote on July 10 is a pivotal moment for the cryptocurrency sector, promising to determine the future regulatory landscape for financial institutions dealing with digital assets. The outcome of the vote, whether it leads to an override of the presidential veto or a pivot to alternative legislative measures, will have far-reaching implications for the crypto industry. As stakeholders eagerly await the decision, the push for a balanced regulatory environment continues, highlighting the essential interplay between legislative action and the evolving dynamics of digital finance.

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Jocelyn Blake
Jocelyn Blakehttps://en.coinotag.com/
Jocelyn Blake is a 29-year-old writer with a particular interest in NFTs (Non-Fungible Tokens). With a love for exploring the latest trends in the cryptocurrency space, Jocelyn provides valuable insights on the world of NFTs.
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